Described by the company in an announcement to the stock market as a “multi-year transformation programme” Capita said the announcements are part of a plan to fix the firm’s issues after it “underinvested in the business,” and placed “too much emphasis on acquisitions to drive growth.”

“Capita has underinvested in the business and there has been too much emphasis on acquisitions to drive growth. As our markets have evolved, the Group has not responded consistently to new customer demand,” Jonathan Lewis, Capita’s CEO said in a surprisingly frank statement.

“Since December, we have continued to experience delays in decision making and weakness in new sales.

“Today, Capita is too complex, it is driven by a short-term focus and lacks operational discipline and financial flexibility.

“Capita needs to change its approach.”

Shares sold off aggressively during early trading, before stabilising at a loss of around 45% for the rest of the day. It was the worst day in the firm’s history in terms of stock performance.

Among Capita’s contracts are administering the pensions of Britain’s teachers, working with the Cabinet Office, running the UK’s electronic tagging service for criminals on behalf the Ministry of Justice, and running numerous helplines for the Department for Work and Pensions.

“Following the recent demise of Carillion, and with Capita also highly exposed to government contracts (Army on-boarding, Teachers pensions, Pensions regulator, HSE, DWP, Cabinet office, MoJ and many more), investors will be quite rightly wondering whether the flood gates are steadily opening to cast light on the risks of government reliance on public-private partnership,” Mike Van Dulken, head of research at Accendo Markets said in an email.

“Too complex, too diverse and just haemorrhaging cash – no we’re not talking about Carillion, but fellow outsourcer in a spot of bother, Capita,” Neil Wilson, senior market analyst at ETX Capital added.